Feasibility Analysis On Finance Lease For JXRI Group

As one of the flexible financing methods, finance lease develops only second to bank loans around international markets. This article systemizes basic theories of finance lease including related concepts, categories and characteristics. Also, the writer summarizes relevant policies, laws and regulations currently, especially for infrastructure construction industry.. In addition, the development situation of finance lease industry has been introduced in detail. Until now, the "four vertical and four horizontal" system of the national railway network has been generally established. The closure of big railway lines projects are in process. The construction of intercity trains and railway within provinces are still conducted with huge investment. Local railway investment groups made big investment into railway construction on behalf of local government. This article focuses on the huge fund gap faced up by local railway investment groups and analyzes the advantages of finance lease with detailed plan and data contrast.As a typical local railway investment group, JXRI Group faces big debt payment pressure and huge fund gap. This article collects real data from JRIG to make analysis. The results have been shown clearly through financing cost comparison between finance lease and bank loans and cautious cash flow forecasting. At the same time, we summarize the risks and notice in this case. Finance lease, with flexibility and efficiency, can meet the financing need for JRIG. This solution could be used for reference by other local railway investment groups.Based on the researches and analyses above, we can draw the conclusion that finance lease could be used as a new way to solve the financing problems and boost railway development with more flexible cash flow distribution and being more efficient.